The Expense and High Cost of Health Care: The Causes and Possible Solutions
Welcome to this installment of the Weekly Health Insurance News Roundup. This time we will be looking one article that looks at the high costs associated with health care and health insurance. Our first article looks at why health care costs are so high. Entitled, "What is Driving Rising Healthcare Costs?", this article comes to us from The American, the Journal of the American Enterprise Institute. In this article, the author looks at the "manifold" reasons for the absurd jumps in health care and health insurance costs.
First the author lays down some blame for high health care costs, including "perverse incentives associated with an insurance-based payment system, low labor-productivity growth in the provision of care, and the closely related issue of a constrained supply of healthcare providers." According to the author, the current private system "overextends and perverts the use of insurance." The author states that the purpose of insurance is to spread catastrophic risk over a wide pool of individuals in order to keep costs manageable. The author uses the automotive insurance industry as a great example of this, citing that we don't have to fill out a claim form when we get an oil change or a tune up, but we do when there's an accident that causes catastrophic damage.
It's therefore the opinion of the author that health insurance also offer a similar style of coverage, wherein only major medical procedures, surgeries, illnesses and so on. Basic health care needs would not be covered under these insurance policies, and, like automobile tune ups and oil changes, should be left to be paid for by the individual. This, according to the author, would make prices much more competitive and, in turn, more affordable for all of us. It's an interesting notion, and we'll see if current reformers push for this type of direction.
This concludes this issue of the Weekly Health Insurance News Roundup. We hope you found it useful and enjoyable, and until next time, have a great week.
